Inside the trillion-dollar selfie industrial complex

A decade ago, I witnessed a glorious sunset over the Mediterranean from the unique vantage point of a cliff on the edge of Oia, a beautiful village on the Greek island of Santorini -- me, my wife and a few dozen other visitors. Everyone was facing the setting sun with all cameras pointed out over the water.

Fast-forward to this week: The rooftop restaurant overlooking Marrakech's Jemaa el-Fnaa square at sunset was crowded with tourists taking pictures. But they weren't facing the setting sun -- they had their backs to the sunset and were taking selfies.

My wife and I chuckled and shook our heads at these ridiculous tourists making duck faces and shamelessly posing for the cameras and smartphones they held (before turning to take a few dozen selfies of our own.) This change in behavior -- the taking of selfies and other photographs inspired and driven in part by social sharing -- is the key to the future of business, marketing and the artificial intelligence age.

It's time to get serious about selfies.

The selfie-driven identity economy

People talk about "surveillance capitalism," which refers to user data-centric business models. But we need another word to replace "surveillance." It's often misleading. Until recently, "surveillance" involved cameras and other data-gathering tools deployed by surveillers.

Cliché surveillance is when, say, a private eye, police officer or spy does a "stakeout" and takes pictures of their target from a car or nearby building. The camera is pointed at the surveilled, who is typically unaware of being watched. "Bugging" a room is another form of "surveillance."

In some "surveillance capitalism," where the watchers deploy the tools and gather data without the target's knowledge or permission, this is an accurate phrase. But when the surveillees are voluntarily seeking out, paying for and deploying the monitoring tools and pointing the camera at themselves, then grant permission for companies to use the data — as is the case with smartphones, webcams and home cameras — the "surveillance capitalism" label is misleading.

A better name is "selfie capitalism."

The latest "selfie capitalism" appliance comes from Google-owned Nest, which this week unveiled a new product called the US$299 Nest Cam IQ. The hardware is nice -- a 4K sensor that produces 1080p video in both normal and full-resolution zoom modes, infrared LED emitters for high-quality night vision, powerful speakers and a three-microphone array for isolating sounds.

But the real power is happening in software. The Nest Cam IQ uses the same face-recognition technology Google uses in Google Photos, which I've written about extensively.

The Nest Cam IQ's "Supersight" feature gives you a zoomed-in picture of anyone's face as people walk around in the camera's field of view. It can tell the difference between a person and a non-person mammal, such as a dog. And it can identify people, too, so you can get alerts only when strangers enter your house.

DeepFace technology

Facebook's DeepFace technology goes even further. Its ability to recognize faces is reportedly better than the FBI's technology, and better than the ability of humans to recognize faces.

Facebook can recognize people even when their face isn't showing. (It looks at contextual clues — clothing, lighting, background objects — in a selfie, then recognizes those contextual elements in other shots where the user's face isn't visible, still identifying the person even with head outside the frame or with back turned.)

Most interestingly, Google and Facebook solicit user help in putting names to faces, in Google's case with user labeling of face-based albums and in Facebook's, with tagging.

The user benefit with Google Photos is better search. Once you've identified that a specific person is Janet and another is Mark, you can search for "Janet with Mark" and Google Photos will show you all photos where both appear.

On Facebook, the user benefit is that it's easier to share photos with people by simply tagging them.

(The fact that other people on Google Photos and Facebook can match your face to your identity without your knowledge or permission is surprisingly uncontroversial.)

The most explicit example of "selfie capitalism" yet is Amazon's Echo Look smart speaker product. Large numbers of people take pictures of themselves every day after getting dressed to share on social media. Using hashtags like #mirrorselfie #outfit #ootd (outfit of the day) and others, they post "outfit selfies" for the purposes of both self-expression and friend-and-follower feedback.

Amazon created a version of its smart speaker designed to make this process better by offering consistent lighting, voice control and A.I. that helps customers choose outfits. In the process, they're blazing a trail to a world where selfies and shopping are the same seamless behavior.

Google, Facebook and Amazon are just well-known examples of a much wider phenomenon, which is the mainstreaming of consumer data extracted from the pictures those consumers take of themselves. Hundreds or thousands of companies are working to mine this rich source of consumer behavior.

Beyond user convenience, the value to Google, Facebook and Amazon for users to identify faces is immeasurable. Photography is an incredibly rich source of data which, when combined with machine learning and other A.I., can speak volumes. With selfies, companies can figure out age, gender, sexual orientation, relationships, hobbies, location and many other factors useful for providing personalized services, and super effective targeted advertising.

I talk about selfies in the abstract. But the classic selfie is by far the richest source of user data there is. It shows the user's face up close, who they're with, what they're doing, what they're wearing, what they care about and where they are. That's user-data gold mine for businesses looking to monetize user data.

The selfie-driven experience economy

In his 1971 book Future Shock, Alvin Toffler wrote that in the future people would spend a large percentage of their income on amazing experiences, to be provided by what he called an "experiential industry." Toffler's prediction came true; today we call it the "experience economy."

To create "experiences," businesses must create "Instragrammable moments." It's important to not only enable customers to experience things, but to create photo opportunities that show them in that experience in the most positive way.

The picture is often more important than the experience.

I ate dinner Thursday night at that rooftop restaurant here in Marrakech. For a full hour, three young women sitting at the table next to us took selfies of themselves drinking, eating, hugging each other and smiling -- and they obsessed over their photos choosing the best ones, cropping, adding filters and so on. They were so focused on conveying to social media followers that they were having fun that they forgot to have fun.

Another recent example: We booked an overnight Berber-style camping experience in the Sahara. There were two options — the "regular" camp, and the newly created and more expensive "luxury" camp. The regular camp involved traditional camel-hair tents, which are cool, but look dull and lifeless in photos. The "luxury" camp had white plastic tents, which were inferior tents in every way but showed up dramatically better in photos against the dark orange sand.

Some of the "luxury" camp customers were wearing bright-red flowing Moroccan robes and Berber turbans (even though they were tourists from China) and spent hours on the dunes and in the camp posing for selfies.

The barefoot Berber owner of this camp (who started with nothing but two camels and a dream) understood this explicitly: He told me he could charge quadruple the price for a camp experience if the visuals were more instagrammable.

This behavior seems newish, but it really isn't. We all understand that people spend discretionary income on products that enhance, define and assert identity. That's why consumers spend more for a certain brand of car, purse, clothing or even smartphone. They're telling the world: This is who I am.

Selfies posted on social media express "self" even better than products do. But to get the best selfies, you have to spend on restaurants, vacations and other experiences that enable pictures to show the consumer in the best possible light capturing special moments in beautiful places. Understanding this shift of self expression from brand association to social photography is a major key to how innovative marketing is succeeding.

The experience economy is driving the evolution of not only services (such as restaurants and Sahara Desert camps) but also products. Look at the importance of front-facing cameras, as well as the fast growth of brand-new product categories, like camera gimbal and selfie drones.

The experience economy is all about amassing the gear and creating a staging ground for selfies. We're only at the beginning of this shift, with selfies leading the charge.

The selfie-industrial complex

And finally, the most obvious business impact of selfies: marketing. Instead of advertising, companies are increasingly staging instagrammable experiences and letting customers spread the good word.

When you add up the selfie-driven identity economy, the selfie-driven experience economy and selfie-driven marketing, you get something like a selfie industrial complex -- a new world of business opportunity that is emerging out of the selfie impulse that has arisen in the past 10 years.

Whether this opportunity will be worth a trillion dollars or a hundred trillion dollars, nobody knows. What I do know is that understanding the selfie behavior and its implications is now a mission critical aspect of business.

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